Conscience Led To Conflict

Players Pay Consequences

As he waited to speak to his board of directors, Newport News Savings Bank Treasurer Jasper R. Eanes worried about losing his job.

He was about to explain why he had taken questions about the savings bank's internal operations to the Federal Home Loan Bank.

Before he spoke, Eanes asked the board for an assurance that he would not be fired, according to minutes of the October meeting.

Eanes told the board that "this was the toughest thing he has ever done (and) that much strain has been put on him and his family. He did a lot of praying and decided he had to do what he felt was right," the minutes state.

Eanes, Byrd H. Saville, Michael L. Jones and Phillip W. Finch have been criticized and undergone personal problems for their roles in blowing the whistle on management problems at Newport News Savings Bank.

Jones, the former Peat Marwick auditor, recalls that his decision to add a footnote on a suspicious North Carolina land deal to the savings bank's 1984 financial statements was not popular with President Jerome W. Hogge Jr. and Chairman Caleb D. West Jr.

"At the time, it was a mutual savings and loan association, owned by depositors and borrowers," Jones said.

"I felt like I was working for the general public, not the board. I had a savings account there, and so did my mother.

"Part of my function as an auditor was to protect the public."

Finch, the former savings bank treasurer and chief financial officer, recalls that after the audit was completed, he felt he had to choose between challenging the way his superiors did business or quitting.

"My honesty and integrity level was going through the top of the thermometer," Finch said. "I could have made a big issue about it and challenged Caleb's standing in the Christian community, or I could flee from the problem."

Finch resigned in September 1985. Jones quit his job at Peat Marwick two months later.

"I was on the path to becoming a partner, but the powers that be indicated that my promotion would be either down the road or not at all," Jones said.

"My leaving had no direct correspondence with Newport News Savings Bank. But, obviously, there were some subconscious feelings in a lot of people's minds about that."

Asa Shield, Jones' former supervisor at Peat Marwick, says he believes the savings bank audit had nothing to do with Jones' departure.

"It was a long audit, but that happens. It's nothing unusual," Shield said.

After they quit, Jones and Finch say they went through some personally difficult times.

"I was sick about it for three years after I left," Finch said.

"We were giving loans without an appraisal or a loan application, and at the same time I had to give the girls who worked in the bank 4 percent raises, when I wanted to give them 10 percent. That's not my style."

Finch and his wife came close to separating; Jones and his wife divorced.

"I don't know if you can specifically say that's why I'm divorced. But I can say I was under a hell of a lot of stress at the time," Jones said.

When they quit, neither Finch nor Jones expected their allegations to surface again.

Jones says he is unfazed by any criticism from West and his supporters.

"I've learned that there's plenty of money to be made without dealing with them," Jones said.

Saville's decision to take his complaints to the Federal Home Loan Bank instantly turned him into an outcast in the eyes of the savings bank's other directors and friends of West and Hogge.

At the Oct. 20 board meeting, board member J. Sinclair Selden Jr., a retired dairy farmer, said Saville's actions were "simply a vendetta" against Hogge and West.

In that same meeting, Hogge called Jones "a very disagreeable auditor." At the Oct. 24 meeting, West called Finch "the worst team player he had ever seen."

"I took that as a compliment," Finch said.

Eanes is still employed by the savings bank, and Saville remains as a member of the board of directors.

Finch is now treasurer for Forrest Coile Associates, an architectural firm, and Jones is a partner in a private accounting company.